The Senate recommended filing criminal charges against several top executives of the Philippine Health Insurance Corporation (PhilHealth), including Health Secretary Francisco Duque III and former PhilHealth president and CEO Ricardo Morales, over the alleged rampant corruption in the state insurer.
As health chief, Duque is the ex-officio chairperson of PhilHealth.
On Tuesday, September 1, Senate President Vicente Sotto III announced the findings from the committee of the whole’s legislative probe into alleged irregularities in PhilHealth.
In the committee report, senators recommended the prosecution of Duque, Morales, and several other top PhilHealth officials:
The Senate recommended the following charges against Duque, Morales, De Jesus, Limsiaco, and Pargas:
These are for their alleged improper and illegal implementation of the Interim Reimbursement Mechanism (IRM) “against its duly authorized purpose” to address the COVID-19 pandemic. The Senate found “grave abuse of discretion or gross negligence” in releasing billions of pesos in IRM funds “without valid criteria for distribution.”
Duque, Morales, De Jesus, Limsiaco, and Pargas are also responsible for PhilHealth’s failure to withhold the tax liabilities of hospitals and clinics that received IRM funds, the Senate said in its report. Instead, the state insurer dipped into its corporate operating budget to temporarily cover the tax obligations of the IRM recipients.
The Senate recommended criminal charges against Del Rosario for his alleged failure to act upon fraud and other cases pending at his office as PhilHealth’s legal chief:
The Senate report also tagged “all other PhilHealth officials and employees who connived with and participated” in these offenses.
As for Aragona and Gabuya, the Senate recommended the following criminal cases:
These are for the alleged “gross overpricing” of proposed procurements of information technology (IT) equipment, and bloating of PhilHealth’s P2.1 billion proposed IT budget for 2020.
Besides criminal cases, the Senate also recommended administrative cases against Morales, De Jesus, Del Rosario, and PhilHealth senior vice president for the management sector Dennis Mas for their alleged failure to follow government rules.
The Senate called for further inquiry into the dialysis clinic chain B. Braun Avitum, which received more than P45 million in IRM funds.
Only taking legal effect on June 11, PhilHealth’s release of more than P14 billion in IRM funds from March to June 9 were deemed illegal, including payments to B. Braun Avitum.
Besides this, the senators found IRM releases to all freestanding dialysis clinics like B. Braun Avitum, as well as any hospital or clinic not catering to COVID-19 patients, illegal.
The Senate called on PhilHealth to immediately require all hospitals and clinics that received IRM funds to submit liquidations and return what is left of the amounts released to them.
It also urged the state insurer to immediately pay the health insurance claims of private hospitals, prioritizing those that are COVID-19 referral centers or that have high numbers of COVID-19 patients.
PhilHealth should outsource its IT services to a reputable company, the Senate report said. The lawmakers called on the Department of Budget and Management to take over the procurement of the state insurer’s IT hardware and software requirements.
It would be better if PhilHealth also contracted out the processing of benefit claims to avoid backlogs and delays in reimbursement, the Senate report said.
In the first place, it was the perennial delays in PhilHealth’s processing of hospitals’ and clinics’ reimbursements that led to the IRM. There would not have been a need for this system of advance payments if the state insurer was prompt in releasing payments, the senators said.
The Senate called on all of PhilHealth’s high-ranking officials, from the CEO down to regional vice presidents, to file their courtesy resignations. President Rodrigo Duterte earlier ordered incoming PhilHealth president and CEO Dante Gierran to “remove” all regional vice presidents.
PhilHealth should reassign its regional vice presidents very 3 years, and none of them should be posted in the same region more than twice, the Senate report said. This is to prevent collusion with hospitals and clinics.
The senior vice president for the legal sector must have at least 5 years of legal practice to qualify for the position, the Senate report recommended. Del Rosario, who last held the post, was appointed in April 2019 without prior experience in law-related positions. He only passed the Bar examinations and became a lawyer in 2016.
The Senate called for more frequent audits and closer supervision of PhilHealth by the Commission on Audit, Insurance Commission, and the Governance Commission for GOCCs. This includes stricter qualifications for “appointive directors” of the state health insurer.
The senators also called on the Anti-Money Laundering Council to immediately investigate whether the bank accounts of PhilHealth officials tagged in the anomalies may be considered "suspicious accounts."
The Senate committee of the whole held 3 hearings, each more than 9 hours long, on August 4, 11, and 18. After the probe, the committee sent copies of documents and testimonies to the Department of Justice (DOJ) to help in the Executive department's separate investigation of the PhilHealth mess.
Prosecutions will, ultimately, depend on the probe led by the DOJ. – Rappler.com
JC Gotinga often reports about the West Philippine Sea, the communist insurgency, and terrorism as he covers national defense and security for Rappler. He enjoys telling stories about his hometown, Pasig City. JC has worked with Al Jazeera, CNN Philippines, News5, and CBN Asia.